I joined N/N when it was still a fledgling enterprise – albeit one with a cool brand and some impressive clients already in the roster. But that wasn’t the first time I’d thrown caution to the wind by joining a startup. My first proper job was to help launch a new analytical venture – one with a bare-bones product, zero clients, minimal hierarchy and no office (we ended up renting some desks at the back of a tiny Greek travel agency, in the days before co-working spaces were a thing).
That startup experience, and my time helping build N/N, taught me some valuable lessons about running a new business that apply to any entrepreneur in the B2B services sector. Even though it feels like a long while since they applied to N/N, as we approach our 10th birthday it also feels like the right time to reflect on how we started and offer help to anyone who might want to take a similar path.
It’s easy for startup tech bros to swagger around, moving fast and breaking things, particularly if they’re convinced that their new platform or piece of code will change the world. They just need investors – and then perhaps a critical mass of users – to share their optimism.
Service providers, though, can’t avoid the subordination of their status to that of their potential clients. And especially when starting out, it’s easy to be overawed by the size, age and prestige of the companies you’re approaching.
Arrogance is never an appealing trait, of course. But even in the earliest days – when your weeks-old company is just you and a website – you can’t afford to come across as inexperienced or small-time. This is mostly because B2B service providers need to win the trust of their prospects to make a sale. Exuding confidence and conviction is a vital part of this. It’s hard to convey these qualities if you’re busy tugging your forelock.
That doesn’t mean promising the world; it does mean refusing to kowtow, get beaten down on price or abase yourself just to get the contract signed. It doesn’t matter how many billions in revenue the prospect’s firm pulls in: if you’re convinced of the quality of your service, sell it as if you were equal to them in age and size.
Point 1 applies when the sale is made, too, or at least agreed in principle. Ideally it’s better to write your own terms and conditions, as then you can be certain they accurately describe the services you’re providing and give you adequate protection.
That’s not always possible, of course: most large firms will have legal departments that insist on the use of standard contracts and terms. Even if you must sign these, don’t under any circumstances do so without reading the small print – or before pushing back on anything that seems unfair or out of scope.
This is particularly important since pro-forma contracts will often contain many clauses and provisions that are either irrelevant to the service you’re providing or are unreasonably onerous. Sometimes these can be very intrusive: demanding the right (for instance) to access your books, inspect your offices and conduct background checks on your staff – to list just a few of the more egregious ones I’ve spotted.
Getting legal help is always advisable, but it’s expensive. Most of the time you’ll be able to spot unreasonable T&C yourself and, following lesson #1, you should feel empowered to push back with revision requests. It feels somewhat amazing to be arguing with the highly trained and expensive legal team at a multi-billion-dollar multinational, but they’re used to it and are nearly always fine with reasonable change requests. (Or at least they should be. If they’re unreasonable, you probably don’t want them as clients anyway – see #3.)
In the early days every signed contract should be celebrated and every client treated like royalty for putting their faith in you. Over time, though, this will – in fact must – change. Even if you don’t start out tracking carefully the amount of effort needed for the dollars clients are bringing in (or that stand a chance of coming in later) you’d better do so as soon as is possible.
Once you start monitoring this, you will quickly be able to work out which relationships are imbalanced in terms of revenue versus effort, due to excessive and/or unreasonable demands on your time and resources – which is especially vexing for those with little chance of future growth.
In these cases, as soon as the contract is done, decline to bid for another one. “Tester” engagements are a learning opportunity for both sides, after all. This is one of the joys of owning a business: it’s your company and you don’t have to work for anyone if you’d rather not. In fact, if you always say yes, your company won’t last long.
Assuming things are going well, small businesses should maintain an always-hiring mindset. There are a couple of logical reasons for this, one being that the difference a good worker can make in a small team can be massive – far more than the marginal cost of the extra headcount. Similarly, the loss of a valued team member can be equally as damaging, so it pays to have a roster of good candidates on the go at all times.
Hiring takes time, so keep at it. And if you’re always thinking “What if there’s a downturn and I have to let people go?” then you probably lack the kind of bull-headed optimism that it takes to run a small business anyway.
It’s not only good advice for tech firms seeking a user base: service providers also need to adjust to conditions as they evolve. This has become ever more crucial in a period of heightened macroeconomic volatility: assess your geographic, sectoral and product range and priorities on a regular basis, and make sure your limited time is being spent on what’s going to be most profitable in the medium term.
There should be a slower evolution in constant progress too. As my colleague Joseph outlined in his aN/Niversary blog, N/N has changed hugely from our early days, as we came to understand and cater for the growing demand for advisory services. Naturally this isn’t an endpoint; the process is continuous. We have numerous initiatives on the go that promise to make the next 10 years as exciting and challenging as the first 10.
I hope these tips help those of you who, like me and the N/N founders, relish the prospect of building and running your own enterprise. The satisfaction it delivers is immense, as is that of discovering and working with an array of massively talented and dedicated people who share the same goals. At our next aN/Niversary, I have no doubt I’ll be able to share lessons about the next stage of our evolution: watch this space.
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